Iraq Economic News and Points to Ponder Monday Afternoon 1-27-25

Government Advisor Reveals Iraq's Gold Reserves And Hedging Against "Ill-Considered Races" To Buy It

Time: 2025/01/27 Read: 1,410 times   {Economic: Al Furat News} The economic advisor to the Prime Minister, Mazhar Muhammad Salih, revealed Iraq’s gold reserves, which are estimated at about 152 tons.

Saleh told {Euphrates News} that: "The gold reserve is undoubtedly an important part of Iraq's foreign exchange reserves, as it contributes to enhancing financial stability and confidence in the national currency. According to the announced data, gold reserves have reached about 152 tons."

He added, "The approximate value of it in the country's foreign investment portfolio is about $14 billion, which constitutes about 13% of the total diversification of that portfolio, which is distributed in standard proportions among other foreign currencies."

Saleh promised that gold is "a safe haven for the balance of the aforementioned investment portfolio, especially when the exchange rates of some currencies or the fluctuation of interest on investing in those currencies are exposed to uncalculated risks in the short term as a result of decline or fluctuation."

He pointed out that "central banks often follow standard guidelines, including our country, in diversifying their investment portfolios in foreign currency, which adopts many criteria, including the density of commercial areas with which they deal in global trade and investment."

Saleh added, "Our country is monitoring this diversification with great precision and with accurate advisory coverage, and it is not necessary to enter into ill-considered races in the yellow metal markets," indicating that "gold often carries its management costs, whether insurance or storage fees in global gold vaults, according to highly accurate mechanisms."

He stressed that "its importance lies in the possibility of issuing bonds when needed, called gold bonds guaranteed by gold," noting that "there are currently buying sprees in the world due to the change in the US administration and the rise in its prices."

According to the statement of Al-Sudani's advisor, "the state of uncertainty surrounding the new US administration has led to a rise in gold prices globally, as gold is a safe haven for investors in times of instability," noting that "despite this, strengthening gold reserves depends on the decisions of the monetary authority and its strategies in maintaining economic stability, and taking the necessary measures at the appropriate time."  LINK

Financial Disclosure And Transparency Is A Strategic Approach For The Central Bank

Samir Al-Nusairi   In the past few days, officials in financial and monetary policy were surprised by the statements of some unspecialized analysts and unspecialized media outlets about the crisis of the lack of liquidity in the Ministry of Finance and the Central Bank and the impact of this on delaying the securing of salaries of employees, retirees and social care. The truth is that there is absolutely no such crisis, and this is what the Ministry of Finance and the Central Bank confirmed.

Central banks in the world's countries aim primarily to achieve economic stability by achieving monetary and financial stability according to their programs and strategies that aim to maintain stability in the exchange rate of their local currencies against other foreign currencies and build sufficient foreign reserves according to special international standards.

Banks are also evaluated based on other standards related to facing crises, challenges and economic and political shocks in their countries and controlling stable rates of inflation and interest rates and implementing compliance systems and rules and combating money laundering and terrorist financing.

The Central Bank of Iraq's journey during 2023 and 2024 has proven that it is moving steadily towards achieving the objectives of monetary policy and with a consistent and strategic approach that relies on transparency and disclosure of financial data and dealing with international financial organizations and institutions, based on the keenness to restore confidence in international banking transactions, which Iraq suffered from in previous years due to reputational risks and the negative media impact towards harming the Iraqi economy and leaking inaccurate and fabricated data, information and statements intentionally or by relying on data from a source other than its official source, which is the Central Bank exclusively.

This led the Central Bank's management, which assumed responsibility in 2023, to draw up its third strategy, and one of its most prominent main and sub-goals was to adopt transparency and disclosure locally and internationally about the progress of the results achieved by the financial and banking sector and adherence to the standard international standards applied by reputable international banks, which led to the creation of a new and balanced relationship with international banks and banking institutions based on trust in the financial data provided and announced by the Central Bank.

This is what he announced from statistics, data and accurate analyses of what was achieved during the past two years.

These are positive indicators achieved by the Central Bank for the third quarter of 2024 compared to the same period in 2022 and 2023, as the total deposits in banks operating in Iraq grew by (4.2%) and amounted to (127.6) trillion dinars, compared to its value of (122.4) trillion dinars in the third quarter of 2023, and the cash credit granted by operating banks also recorded a growth of (11.6%) and amounted to (72.7) trillion dinars, compared to its value of (65.1) trillion dinars in the third quarter of 2023.

Indicators and data showed that the narrow money supply in Iraq recorded a growth of (4.1%) in the third quarter of 2024, as its value reached (158.6) trillion dinars, compared to its value of (152.4) trillion dinars in the third quarter of 2023. In contrast, the broad money supply in Iraq recorded a growth of (3.3%), as its value reached (179.1) trillion dinars, compared to its value of (173.9) trillion dinars in the third quarter of 2023.

The Central Bank's gold reserves also recorded a significant growth of (57%) in the third quarter of 2024, reaching (16) trillion dinars, compared to (10.7) trillion dinars in the third quarter of 2023, and the annual inflation rates in Iraq are among the lowest annual inflation rates in the countries of the region for the months of August and September of 2024, ranging between (3.1%) and (3.7%) respectively, which reflects price stability and the success of monetary policy in Iraq.

This confirms that the data issued by the Central Bank, published on its website and included in all media releases it issues, refute what is stated by non-specialists, such as representatives and analysts in various media outlets, especially regarding liquidity, reserves and salaries.

Through my analysis as a follower and specialist, I believe that the Central Bank’s disclosure of financial data with the required accuracy will greatly help restore confidence in our national economy and the Iraqi banking sector locally and internationally, because disclosure, transparency and credibility will contribute to restoring confidence in the Iraqi banking sector and raising the rate of financial inclusion. https://economy-news.net/content.php?id=52313

93% Of The Central Bank Of Iraq's Sales Are For Foreign Remittances

Economy   | 01/27/2025   Mawazine News – Baghdad  Foreign transfers in the Central Bank of Iraq's sales, in Monday's currency auction, amounted to more than 93%.

The bank sold 296 million, 590 thousand, and 953 dollars in its auction today, covering it at a basic exchange rate of 1310 dinars per dollar for documentary credits and international settlements for electronic cards, and at a rate of 1310 dinars per dollar for foreign transfers, and at a rate of 1305 dinars per dollar in cash.

Most of the dollar sales went to enhance balances abroad in the form of transfers and credits, which amounted to 276 million, 790 thousand, and 953 dollars, at a rate of 93.12%, compared to cash withdrawals of 19 million and 800 thousand dollars.

The number of banks that bought cash dollars amounted to one bank, while the number of banks that met requests to enhance balances abroad amounted to 6 banks, and the total number of exchange companies participating in the auction was 28 companies. https://www.mawazin.net/Details.aspx?jimare=259094

Dollar falls in Baghdad and Erbil as stock exchange closes

Economy | 04:28 - 01/27/2025   Mawazine News – Economy   The US dollar exchange rate against the Iraqi dinar fell on Monday in the markets of Baghdad and Erbil, the capital of the Kurdistan Region, with the closing of the stock exchange.

A Mawazine News correspondent said that the dollar exchange rate fell with the closing of the two main stock exchanges in Baghdad, Al-Kifah and Al-Harithiya, to record 150,500 dinars for every 100 dollars, while the prices were 150,900 dinars for every 100 dollars this morning.

Our correspondent pointed out that the selling prices in the exchange shops in the local markets in Baghdad decreased, as the selling price reached 151,500 dinars for every 100 dollars, while the purchase price reached 149,500 dinars for every 100 dollars.

In Erbil, the dollar also fell, as the selling price reached 150,400 dinars for every 100 dollars, and the purchase price was 150,300 dinars for every 100 dollars. Https://Www.Mawazin.Net/Details.Aspx?Jimare=259097

Oil Prices Fall By More Than 1%

Economy |  01/27/2025  Mawazine News – Baghdad  Oil prices fell more than 1 percent in early Asian trading on Monday after US President Donald Trump called on OPEC to lower prices following the announcement of sweeping measures to boost US oil and gas production in his first week in office.

Markets move Brent crude futures were down 87 cents, or 1.11%, at $77.63 a barrel by 0043 GMT after closing up 21 cents on Friday. U.S. West Texas Intermediate crude was down 89 cents, or 1.19%, at $73.77, according to Reuters data.

Trump on Friday reiterated his call for OPEC to lower oil prices to hurt the finances of oil-rich Russia and help end the war in Ukraine. "One way to stop the war quickly is for OPEC to stop making so much money and lower the oil prices...

The war will stop right away," Trump said. OPEC and its allies, including Russia, have yet to respond to Trump's call, with OPEC+ representatives indicating they already have a plan to start increasing oil output from April, Reuters reported.

Brent and U.S. crude posted their first declines in five weeks last week as concerns about supply cuts from sanctions on Russia eased. Analysts at Goldman Sachs said Sachs said they do not expect Russian production to be significantly affected because higher freight rates encourage more supplies to non-sanctioned vessels to transport Russian oil, while the steep discount on Russian ESPO crude lures price-wary customers to continue buying.

“Given that the ultimate goal of sanctions is to reduce Russian oil revenues, we assume that Western policymakers will prioritize maximizing discounts on Russian oil over reducing production volumes,” the analysts added in a note.

But JPMorgan analysts said some risk premium was justified given that nearly 20 percent of the world’s Aframax tankers are currently under sanctions.

“Applying sanctions on the Russian energy sector as leverage in future negotiations could lead to uncertain outcomes, suggesting that a zero risk premium is not appropriate,” they said in a note.https://www.mawazin.net/Details.aspx?jimare=259071

 

For current and reliable Iraqi news please visit:  https://www.bondladyscorner.com/

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